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China to cap rare earth production at 93,800 tonnes in 2013: ministry

BEIJING (Reuters) - China will cap rare earth production at 93,800 tonnes over the whole of 2013 as part of efforts to rein in unlicensed production in the sector, the country's land and resources ministry said on Friday.

The figure is the same as 2011. China did not announce a national production cap for 2012, but instead imposed limits on a province-by-province basis.

China produces more than 90 percent of global rare earth supplies, making it a key exporter of a series of 17 metals with a range of applications in sectors such as defense, telecommunications and renewable energy.

Since 2010, Beijing has been trying to exert more control over the sector, where unauthorized production, environmental pollution and smuggling have been rife. It launched another campaign in early August aimed at cracking down on illegal activities.

Its efforts to cut output and impose strict export quotas have been criticized by foreign governments concerned about China's chokehold over supplies.

The United States, Japan and the European Union have complained to the World Trade Organization about Beijing's efforts to control the sector, saying China is trying to use its stranglehold over supplies to drive up prices and gain a competitive advantage.

But China has repeatedly said rampant overmining has caused untold ecological damage and that it no longer wants to pay the environmental costs of supplying the vast bulk of the world's rare earths.